Flat taxes (or “fair taxes” as they’re sometimes erroneously called) are flatly UNfair.
It theoretically sounds “fair” to tax everyone at the same percentage—until one looks at the facts.
HOUSING AND TRANSPORTATION
Families struggling to make ends meet, making a median income of $40,000 annually will pay about 33% of their income for minimum housing expenses and another 17% for transportation (calculated at $3/gallon prices—too low, I know). Those two items capture 50% of their total income.
A family making $1 Million annually can pay $85,000/year for housing and $57,000 for transportation. They pay only 14.2% of their income for the same two items.
FOOD
Assume the wealthy family spends $73,000 on food annually ($200/day). That’s only 7.3% of their income.
The average family spends $4,656/year (a little over $1/day for a family of four) on food. That’s 11.18% of their income.
MEDICAL
Let’s consider that the average family spends $6,600/year for insurance and/or medical bills. That amounts to 15.84% of their income.
The wealthy family can afford to pay $33,600 (high estimate), which reduces their income by only 3.36%.
CLOTHING
The wealthiest family can spend $12,000/annually for clothing (1.2% of income).
The median income family may shop garage sales and thrift shops, buying clothes for a family of four on only $600/year. That comes to 1.44% of annual income on clothing.
Housing, transportation, food, medical costs, and clothing are necessities.
An average family will spend 94.9% of their income on NECESSITIES! They have exactly $2,124.41 left for emergencies, medical co-pays, savings, investments, college tuition savings, etc.
The wealthy family has spent only 56.46% of their income, leaving them with 43.54%--$435,400!
Costs are the same for all income levels. Rising housing, gas, and food prices won’t appreciably affect the wealthy, but can devastate an average family. One missed paycheck—due to layoffs, illness, etc—could bankrupt an average family.
Jefferson said, “Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise."
Wednesday, July 27, 2011
Monday, July 25, 2011
WHO DOESN'T PAY INCOME TAXES
We hear conservatives and liberals alike complain about how many people don’t pay income taxes. Those numbers are frequently inflated, but a New York Times article, written by Bruce Bartlett (who held senior policy roles in the Reagan and George H.W. Bush administrations and served on the staffs of Representative Jack Kemp and Ron Paul), helps set some records straight with up-to-date information.
The actual percentage of non-payers for 2011 is 46.4 percent (from the Tax Policy Center). Mr. Bartlett points out that the growth of the percentage of non-payers is “largely a result of Republican tax policies.” The earned-income tax credit (originated by Ford and expanded by both Reagan and Bush I, in lieu of raising minimum wages) was the main reason for lower incomes being largely exempted. Because of that, the percentage of non-payers rose from 19.2% to 25.2%.
In the 1990s George W. Bush’s GOP administration added a large child credit to the tax code. The percentage of non-tax payers jumped to 36.3%, as a result.
In 2011, 78,000 individuals making incomes of $211,000-$533,000 or more paid not one cent of income taxes. There are additionally 24,000 with incomes of $533,000-$2.2 Million that pay zero. Why? Bruce Bartlett says it’s because capital gains (taxed at only 15%) are a huge percentage of their incomes or they may have invested some or all of their wealth in tax-free municipal bonds.
These are the “Welfare Queens” who prey on tax loopholes to fill their own pockets.
A large percentage of those who paid no income taxes earned less than $16,812 in 2010. Many of them are part-time workers, youth working their way through school, unskilled laborers, or seniors trying to make ends meet.
Thomas Jefferson wrote James Madison in 1785, "Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise.”
This is far from a new concept. It worked for a very long time during America’s most prosperous years.
The actual percentage of non-payers for 2011 is 46.4 percent (from the Tax Policy Center). Mr. Bartlett points out that the growth of the percentage of non-payers is “largely a result of Republican tax policies.” The earned-income tax credit (originated by Ford and expanded by both Reagan and Bush I, in lieu of raising minimum wages) was the main reason for lower incomes being largely exempted. Because of that, the percentage of non-payers rose from 19.2% to 25.2%.
In the 1990s George W. Bush’s GOP administration added a large child credit to the tax code. The percentage of non-tax payers jumped to 36.3%, as a result.
In 2011, 78,000 individuals making incomes of $211,000-$533,000 or more paid not one cent of income taxes. There are additionally 24,000 with incomes of $533,000-$2.2 Million that pay zero. Why? Bruce Bartlett says it’s because capital gains (taxed at only 15%) are a huge percentage of their incomes or they may have invested some or all of their wealth in tax-free municipal bonds.
These are the “Welfare Queens” who prey on tax loopholes to fill their own pockets.
A large percentage of those who paid no income taxes earned less than $16,812 in 2010. Many of them are part-time workers, youth working their way through school, unskilled laborers, or seniors trying to make ends meet.
Thomas Jefferson wrote James Madison in 1785, "Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise.”
This is far from a new concept. It worked for a very long time during America’s most prosperous years.
Sunday, July 24, 2011
VOUCHERING EDUCATION
I have devoted most of my life, and almost all my career, to furthering public education. Unfortunately, it may be dying a slow death.
The K-12 system has already suffered enormous losses. Just last year 40% of all jobs lost in America were from public schools and it doesn’t look like that will improve soon. Vouchers and charter schools are taking over public education, which is not a good thing.
Vouchers (tax credits) like the ones proposed by the Oklahoma legislature are a joke. They include families making up to $122,379 annually, although they were sold as an opportunity for low-income children to attend private schools.
Well more than half of our population qualifies for the scholarships, which are capped at $5000 per student.
Of nine private schools in Okla. City and Tulsa, the tuition range is $5,655 to $16,475. The average was $11,011.33—which leaves “low income” families with a bill of $6,011.33! Truly low income families cannot afford that!
Post-secondary education is also facing direct hits by legislators around the nation. “For profit” colleges have popped up throughout our country, with devastating consequences for many students.
Public schools, technology centers, colleges, and universities have to abide by certain guidelines in order to maintain accreditation. Those guidelines ensure accountability and successful outcomes. We are extremely fortunate to have several quality post-secondary opportunities for youth in the area. The post-secondary schools work closely with workforce professionals and industries to provide courses that will lead to jobs in demand occupations that provide self-sufficient wages for our citizens.
The educators with whom I’ve had the privilege of working are professionals who’ve devoted their lives to providing valuable opportunities for young people—all young people, not just the privileged few. Some have forgone their own opportunities to make a lot of money to do so. Many teachers themselves live on “poverty wages” and their own children qualify for free or reduced rate lunches.
Children deserve to be valued by people who care deeply for them and their futures, instead of private industries that see them as “raw materials” used to make profits.
The K-12 system has already suffered enormous losses. Just last year 40% of all jobs lost in America were from public schools and it doesn’t look like that will improve soon. Vouchers and charter schools are taking over public education, which is not a good thing.
Vouchers (tax credits) like the ones proposed by the Oklahoma legislature are a joke. They include families making up to $122,379 annually, although they were sold as an opportunity for low-income children to attend private schools.
Well more than half of our population qualifies for the scholarships, which are capped at $5000 per student.
Of nine private schools in Okla. City and Tulsa, the tuition range is $5,655 to $16,475. The average was $11,011.33—which leaves “low income” families with a bill of $6,011.33! Truly low income families cannot afford that!
Post-secondary education is also facing direct hits by legislators around the nation. “For profit” colleges have popped up throughout our country, with devastating consequences for many students.
Public schools, technology centers, colleges, and universities have to abide by certain guidelines in order to maintain accreditation. Those guidelines ensure accountability and successful outcomes. We are extremely fortunate to have several quality post-secondary opportunities for youth in the area. The post-secondary schools work closely with workforce professionals and industries to provide courses that will lead to jobs in demand occupations that provide self-sufficient wages for our citizens.
The educators with whom I’ve had the privilege of working are professionals who’ve devoted their lives to providing valuable opportunities for young people—all young people, not just the privileged few. Some have forgone their own opportunities to make a lot of money to do so. Many teachers themselves live on “poverty wages” and their own children qualify for free or reduced rate lunches.
Children deserve to be valued by people who care deeply for them and their futures, instead of private industries that see them as “raw materials” used to make profits.
DISSERVICE TO OUR VETS
Mr. Santorum,
Pardon the lack of a proper salutation, but I just couldn’t bring myself to use Honorable with your name.
Your crude comments on June 6, 2011 about the reason so many of our American soldiers landed at Normandy did a huge disservice to those brave young men. The young men about whom you spoke parachuted into and landed on the beaches of Normandy to help make a better world and to eliminate the Nazi influence in Europe.
You think they put their lives on the line so that they could make their own choices about health care? Not even close! They did it for far loftier reasons than you can evidently imagine.
Those same young men are the gentleman I see on a regular basis at the Oklahoma Veterans’ Center—who are now in their mid-80’s to early 90’s—when I visit my almost 95 year old father, who’s a WWII veteran.
How many of those gentlemen do you really think can make their own decisions about health care? How many of them could afford to pay more out of pocket for their medical expenses? Some of those who were severely injured couldn’t make those decisions when they were in their 50’s, much less now.
My precious father received two five year degrees simultaneously after studying four total years—one in Architecture and one in Architectural Engineering. He was an extremely intelligent man who was raised by a single mother during the Great Depression. He would never have been able to attend college without the benefit of the G.I. Bill.
He participated in the National Youth Association (a WPA program for poor youth, providing “work study” projects at their schools) and learned skills that took him later to an Aircraft Mechanic program with Beechcraft in Wichita, Kansas, that eventually led him to become an aircraft inspector in England during the War. Two of his three brothers were involved in another WPA program, CCC (Civilian Conservation Corps) that targeted unemployed, unmarried men from relief families, ages 18-25. Those two gentlemen both became successful citizens who provided well for their own families, as a result of that program.
My Daddy saw firsthand the devastation the Depression brought to his family and others. He still carefully tears Kleenex into smaller sections, a carryover from the days when they were a luxury.
He worked hard all his life, well into his eighties, but never made enough money to save a great deal. His Social Security and Medicare, along with access to veteran’s health care, have enabled him to survive. He’s one of the fortunate ones who has family to care for him and kept him at home until he was no longer able to physically get around on his own.
You should be most ashamed, though, for using a day intended to honor the sacrifices our WWII heroes, living and deceased, as political fodder.
Pardon the lack of a proper salutation, but I just couldn’t bring myself to use Honorable with your name.
Your crude comments on June 6, 2011 about the reason so many of our American soldiers landed at Normandy did a huge disservice to those brave young men. The young men about whom you spoke parachuted into and landed on the beaches of Normandy to help make a better world and to eliminate the Nazi influence in Europe.
You think they put their lives on the line so that they could make their own choices about health care? Not even close! They did it for far loftier reasons than you can evidently imagine.
Those same young men are the gentleman I see on a regular basis at the Oklahoma Veterans’ Center—who are now in their mid-80’s to early 90’s—when I visit my almost 95 year old father, who’s a WWII veteran.
How many of those gentlemen do you really think can make their own decisions about health care? How many of them could afford to pay more out of pocket for their medical expenses? Some of those who were severely injured couldn’t make those decisions when they were in their 50’s, much less now.
My precious father received two five year degrees simultaneously after studying four total years—one in Architecture and one in Architectural Engineering. He was an extremely intelligent man who was raised by a single mother during the Great Depression. He would never have been able to attend college without the benefit of the G.I. Bill.
He participated in the National Youth Association (a WPA program for poor youth, providing “work study” projects at their schools) and learned skills that took him later to an Aircraft Mechanic program with Beechcraft in Wichita, Kansas, that eventually led him to become an aircraft inspector in England during the War. Two of his three brothers were involved in another WPA program, CCC (Civilian Conservation Corps) that targeted unemployed, unmarried men from relief families, ages 18-25. Those two gentlemen both became successful citizens who provided well for their own families, as a result of that program.
My Daddy saw firsthand the devastation the Depression brought to his family and others. He still carefully tears Kleenex into smaller sections, a carryover from the days when they were a luxury.
He worked hard all his life, well into his eighties, but never made enough money to save a great deal. His Social Security and Medicare, along with access to veteran’s health care, have enabled him to survive. He’s one of the fortunate ones who has family to care for him and kept him at home until he was no longer able to physically get around on his own.
You should be most ashamed, though, for using a day intended to honor the sacrifices our WWII heroes, living and deceased, as political fodder.
LIVING ON SOCIAL SECURITY AND MEDICARE
Ask my 94 year old father if Social Security and/or Medicare should be “transformed.”
He was born in 1916 and raised by his uncle on a farm where he worked until he dropped out of high school. His family was not only poor, as he always said, “we were so poor, we pronounced it ‘pore’.” His grandmother offered him room and board at her house if he went back to school, so he did while working at a local department store.
After graduating from high school, he was admitted into an NYA (National Youth Administration) program, where he was elected student body president.
Soon afterward, his uncle helped him enroll in an aircraft mechanic program in Wichita, Kansas. While there, he was drafted into World War II. The company arranged for a deferral for him—twice. The third time, he decided he wouldn’t accept another deferral and he served in England as an aircraft inspector until after VE Day.
Following WWII, he enrolled at Okla. State University (then Oklahoma A&M). He enrolled in the architecture program and, in the next four years, completed two five year degrees—Architecture and Architectural Engineering.
After working about seven years for other architectural firms, he decided to go into business for himself. So, in 1957, he opened his own office.
Work was sporadic for many years and, although he was paid well upon completion of a project, he never had a steady salary, retirement, or company insurance. My mother worked her whole life, until it was cut short by cancer when she was 49 years old, with two daughters ages 17 and 18. Her Social Security benefits allowed both to attend college.
My father retired when he was in his 80’s and has lived entirely on his Social Security and Medicare since. Fortunately, those programs, along with his VA benefits, have enabled him to live with dignity. What, though, would have happened to him if he hadn’t had them?
My father has been a Republican all his life, but he would not support the “transformation” of these programs!
He was born in 1916 and raised by his uncle on a farm where he worked until he dropped out of high school. His family was not only poor, as he always said, “we were so poor, we pronounced it ‘pore’.” His grandmother offered him room and board at her house if he went back to school, so he did while working at a local department store.
After graduating from high school, he was admitted into an NYA (National Youth Administration) program, where he was elected student body president.
Soon afterward, his uncle helped him enroll in an aircraft mechanic program in Wichita, Kansas. While there, he was drafted into World War II. The company arranged for a deferral for him—twice. The third time, he decided he wouldn’t accept another deferral and he served in England as an aircraft inspector until after VE Day.
Following WWII, he enrolled at Okla. State University (then Oklahoma A&M). He enrolled in the architecture program and, in the next four years, completed two five year degrees—Architecture and Architectural Engineering.
After working about seven years for other architectural firms, he decided to go into business for himself. So, in 1957, he opened his own office.
Work was sporadic for many years and, although he was paid well upon completion of a project, he never had a steady salary, retirement, or company insurance. My mother worked her whole life, until it was cut short by cancer when she was 49 years old, with two daughters ages 17 and 18. Her Social Security benefits allowed both to attend college.
My father retired when he was in his 80’s and has lived entirely on his Social Security and Medicare since. Fortunately, those programs, along with his VA benefits, have enabled him to live with dignity. What, though, would have happened to him if he hadn’t had them?
My father has been a Republican all his life, but he would not support the “transformation” of these programs!
HISTORY IS REPEATING ITSELF
Throughout the 1800s, and well into the twentieth century, American workers were often subjected to working excessive hours in low paying jobs and dangerous, unsafe working conditions. Children worked alongside their parents, unable to get an education in order to help families put food on their tables.
When the Triangle Shirtwaist Factory caught fire and 146 women and girls died 100 years ago this year, public awareness peaked. The American people learned that many of the deaths were preventable because of locked exits and raw materials blocking other escape routes. Activists emerged and labor unions gained enough strength to help workers collectively bargain for livable wages, decent hours, regulations on child labor, and safety measures for the workplace.
Thanks to the efforts of labor unions, the U.S. has minimum wage laws, child labor laws, mandatory overtime pay for hours worked beyond designated workweek hours, and mostly sufficient workplace safety regulations that protect workers throughout our great nation. We shouldn’t have to worry about sweatshops in the 21st century. Or should we?
American corporations are shipping more and more jobs overseas in order to increase profits and please their shareholders. The only way that can be done is by reducing costs and, by hiring overseas workers, companies can pay far less than they’d have to pay for labor in the U.S., thereby reducing their costs.
As recently as December, 2010, just before Christmas, a Bangladesh garment factory making clothes for American companies burned under similar circumstances as the Triangle fire in New York City 100 years ago. They, too, had locked exits. Twenty-nine women and children died and over 100 were injured.
In 1911, the Triangle workers made $0.14 per hour. Almost 100 years later, in 2010, the Bangladesh workers made $0.28 per hour. And, the Bangladesh victims’ families were each given only $2080 compensation for their deaths.
We supported the sweatshop and their loathsome practices in Bangladesh if we’ve ever bought Baby Gap jeans (400,000 were destroyed in that fire) or other items made there for Gap (their largest client), Wal Mart, H&M, Target, or J.C. Penney.
97% of American clothing is now made overseas. We only produce 3 items of clothing for every 100 items sold here. We are not only allowing American corporations to exploit workers in other parts of the world, we are encouraging it every time we buy merchandise made elsewhere.
This is only one of several reasons American factories are moving their companies overseas. When we purchase goods made by poorly paid workers in unsafe workplaces, we’re essentially saying it’s okay to exploit workers, as long as they’re not Americans.
Human beings have rights—ALL humans—worldwide.
We want cheap goods, but at what cost to human life?
When the Triangle Shirtwaist Factory caught fire and 146 women and girls died 100 years ago this year, public awareness peaked. The American people learned that many of the deaths were preventable because of locked exits and raw materials blocking other escape routes. Activists emerged and labor unions gained enough strength to help workers collectively bargain for livable wages, decent hours, regulations on child labor, and safety measures for the workplace.
Thanks to the efforts of labor unions, the U.S. has minimum wage laws, child labor laws, mandatory overtime pay for hours worked beyond designated workweek hours, and mostly sufficient workplace safety regulations that protect workers throughout our great nation. We shouldn’t have to worry about sweatshops in the 21st century. Or should we?
American corporations are shipping more and more jobs overseas in order to increase profits and please their shareholders. The only way that can be done is by reducing costs and, by hiring overseas workers, companies can pay far less than they’d have to pay for labor in the U.S., thereby reducing their costs.
As recently as December, 2010, just before Christmas, a Bangladesh garment factory making clothes for American companies burned under similar circumstances as the Triangle fire in New York City 100 years ago. They, too, had locked exits. Twenty-nine women and children died and over 100 were injured.
In 1911, the Triangle workers made $0.14 per hour. Almost 100 years later, in 2010, the Bangladesh workers made $0.28 per hour. And, the Bangladesh victims’ families were each given only $2080 compensation for their deaths.
We supported the sweatshop and their loathsome practices in Bangladesh if we’ve ever bought Baby Gap jeans (400,000 were destroyed in that fire) or other items made there for Gap (their largest client), Wal Mart, H&M, Target, or J.C. Penney.
97% of American clothing is now made overseas. We only produce 3 items of clothing for every 100 items sold here. We are not only allowing American corporations to exploit workers in other parts of the world, we are encouraging it every time we buy merchandise made elsewhere.
This is only one of several reasons American factories are moving their companies overseas. When we purchase goods made by poorly paid workers in unsafe workplaces, we’re essentially saying it’s okay to exploit workers, as long as they’re not Americans.
Human beings have rights—ALL humans—worldwide.
We want cheap goods, but at what cost to human life?
SOCIAL INSECURITY
Since when is Social Security an “entitlement” that is disposable?
Social Security was enacted in 1935 as a result of the massive unemployment that took place during the Great Depression “. . . to provide for the general welfare by establishing a system of federal old-age benefits . . .” It seems ironic that addressing a Constitutional value (promoting for the general welfare—see Preamble) is brushed aside so easily by those who profess to believe in its inherent values.
Many Americans work in industries that do not provide pensions for workers when they retire. More often than not, those are also the ones who make less than average wages, so savings are frequently non-existent. The Social Security system was developed to help people retire with dignity, by providing them with “deferred wages.” The individual pays into that system—by working! Employers contribute matching amounts, as part of their employees’ benefits.
The bottom line is that no one gets Social Security retirement benefits without working. They get money back that they and their employers have paid into that system. They are benefits earned—actual wages that they earned and paid into Social Security and the deferred wages earned that their employers contributed!
When you hear people talk about raising the retirement age because life expectancy has increased, remember that life expectancy has only significantly increased for the wealthy. In 1972, the life expectancy of a 60 year old male worker who made less than median income was 78. Workers in the top half of income distribution could expect to reach age 79. By 2001, the lower income man could expect to reach 80, while the higher income man’s life expectancy jumped to 85. Less than 40 years ago, there was a difference of one year life expectancy between the income groups, then it became a four year difference—just because of income.
There are ways to bolster Social Security that would keep it viable for many years and continue to fulfill the promise made by our ancestors in another era when times were also tough.
Social Security was enacted in 1935 as a result of the massive unemployment that took place during the Great Depression “. . . to provide for the general welfare by establishing a system of federal old-age benefits . . .” It seems ironic that addressing a Constitutional value (promoting for the general welfare—see Preamble) is brushed aside so easily by those who profess to believe in its inherent values.
Many Americans work in industries that do not provide pensions for workers when they retire. More often than not, those are also the ones who make less than average wages, so savings are frequently non-existent. The Social Security system was developed to help people retire with dignity, by providing them with “deferred wages.” The individual pays into that system—by working! Employers contribute matching amounts, as part of their employees’ benefits.
The bottom line is that no one gets Social Security retirement benefits without working. They get money back that they and their employers have paid into that system. They are benefits earned—actual wages that they earned and paid into Social Security and the deferred wages earned that their employers contributed!
When you hear people talk about raising the retirement age because life expectancy has increased, remember that life expectancy has only significantly increased for the wealthy. In 1972, the life expectancy of a 60 year old male worker who made less than median income was 78. Workers in the top half of income distribution could expect to reach age 79. By 2001, the lower income man could expect to reach 80, while the higher income man’s life expectancy jumped to 85. Less than 40 years ago, there was a difference of one year life expectancy between the income groups, then it became a four year difference—just because of income.
There are ways to bolster Social Security that would keep it viable for many years and continue to fulfill the promise made by our ancestors in another era when times were also tough.
DEBT CEILING VOTE
Republicans have openly stated that their #1 goal is to defeat Pres. Obama. They have frankly said that the poor and middle classes need to pay more. They publicly acknowledge that protecting the richest Americans (and corporations) is their primary objective. They have candidly admitted that they reject governmental regulations or programs. They are demolishing programs that help the poor, disabled, elderly, unions, or middle class workers who don’t have lobbyists to represent them.
The GOP asked for $2 Trillion in spending cuts. The Obama administration offered $4 Trillion. Republican leadership said, “No.” If eliminating the debt is truly the goal, there’s no logical reason to reject the larger reduction.
Debt ceiling bills have traditionally been clean—bills that raised it, with no strings attached. Republicans decided they would use a necessary bill to get rid of programs they never liked—Social Security, Medicare, Medicaid, regulatory agencies that ensure our safety, etc. It’s not only mean-spirited, it’s irresponsible.
What will happen if we don’t raise the debt ceiling? Looking at history is one of the best ways to find out.
In the spring of 1979, during a similar debate to what we’re having now, there was a last-minute approval of raising the debt limit. Because of the last-minute approval, a flood of investor demand for Treasury bills, and a series of technical glitches in processing a backlog of paperwork, $120 M of payments to Treasury bill holders were delayed. The problems were corrected, the bills were paid (late), but the U.S. paid a high price for it.
Technically this was not a default but a simple delay in payments. There were expensive consequences, though. The late payments resulted in an increase in interest rates of 0.6%, which added another $6 Billion annually to our debt.
Think about paying a credit card bill late. One late payment often causes other companies to increase their interest rates to protect themselves from becoming victims of future late payments.
It’s serious and our Congressional delegates need to understand that investors will punish the U.S., and its taxpayers, if checks stop showing up. Pass the bill.
The GOP asked for $2 Trillion in spending cuts. The Obama administration offered $4 Trillion. Republican leadership said, “No.” If eliminating the debt is truly the goal, there’s no logical reason to reject the larger reduction.
Debt ceiling bills have traditionally been clean—bills that raised it, with no strings attached. Republicans decided they would use a necessary bill to get rid of programs they never liked—Social Security, Medicare, Medicaid, regulatory agencies that ensure our safety, etc. It’s not only mean-spirited, it’s irresponsible.
What will happen if we don’t raise the debt ceiling? Looking at history is one of the best ways to find out.
In the spring of 1979, during a similar debate to what we’re having now, there was a last-minute approval of raising the debt limit. Because of the last-minute approval, a flood of investor demand for Treasury bills, and a series of technical glitches in processing a backlog of paperwork, $120 M of payments to Treasury bill holders were delayed. The problems were corrected, the bills were paid (late), but the U.S. paid a high price for it.
Technically this was not a default but a simple delay in payments. There were expensive consequences, though. The late payments resulted in an increase in interest rates of 0.6%, which added another $6 Billion annually to our debt.
Think about paying a credit card bill late. One late payment often causes other companies to increase their interest rates to protect themselves from becoming victims of future late payments.
It’s serious and our Congressional delegates need to understand that investors will punish the U.S., and its taxpayers, if checks stop showing up. Pass the bill.
GRIM FAIRY TALE
We can believe the fantasy that granting special favors to the extremely wealthy will miraculously make them decide to create hundreds of thousands of jobs.
We can rest assured that, if we lower taxes for corporations that have over $2,000,000,000,000.00 just sitting around, they will bring profits back to America, factories will reopen, and life will be good again.
We can hang on to the hope that if we all tighten our belts and sacrifice even more to make life rosier for billionaires that we can somehow afford to buy enough gas to get to work.
We can believe that when politicians refuse to protect Social Security, Medicare, and Medicaid, they are really looking out for our best interests and we must work longer before we get the benefits we paid into Social Security or the medical assistance we also paid for. We can accept that paying more out of our own pockets is the only way these programs can continue to exist.
We can believe that eliminating programs that protect our health and safety really aren’t needed.
We can delude ourselves into thinking that public education really shouldn’t be for everyone—just the ones who can afford it.
We can believe that not everyone deserves “rights” and that only the select few deserve to succeed.
We can believe that the tooth fairy will put a billion dollars under our pillows tonight. It won’t happen.
It hasn’t happened in the past 30 years and it won’t happen now.
Einstein said insanity is doing the same thing over and over again and expecting different results.
Taxes for the extremely wealthy are lower than they’ve been in years. Since 2003 when taxes on the top income group dropped to current levels, we’ve seen more and more industries moving overseas, far fewer jobs, huge bank failures, Wall Street scandals, and stagnant median wages for all but the ultra-rich (theirs are 976 times more than the bottom 90% of us).
If we still believe in the American Dream we need to vote for those who will protect it for all of us!
We can rest assured that, if we lower taxes for corporations that have over $2,000,000,000,000.00 just sitting around, they will bring profits back to America, factories will reopen, and life will be good again.
We can hang on to the hope that if we all tighten our belts and sacrifice even more to make life rosier for billionaires that we can somehow afford to buy enough gas to get to work.
We can believe that when politicians refuse to protect Social Security, Medicare, and Medicaid, they are really looking out for our best interests and we must work longer before we get the benefits we paid into Social Security or the medical assistance we also paid for. We can accept that paying more out of our own pockets is the only way these programs can continue to exist.
We can believe that eliminating programs that protect our health and safety really aren’t needed.
We can delude ourselves into thinking that public education really shouldn’t be for everyone—just the ones who can afford it.
We can believe that not everyone deserves “rights” and that only the select few deserve to succeed.
We can believe that the tooth fairy will put a billion dollars under our pillows tonight. It won’t happen.
It hasn’t happened in the past 30 years and it won’t happen now.
Einstein said insanity is doing the same thing over and over again and expecting different results.
Taxes for the extremely wealthy are lower than they’ve been in years. Since 2003 when taxes on the top income group dropped to current levels, we’ve seen more and more industries moving overseas, far fewer jobs, huge bank failures, Wall Street scandals, and stagnant median wages for all but the ultra-rich (theirs are 976 times more than the bottom 90% of us).
If we still believe in the American Dream we need to vote for those who will protect it for all of us!
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